Wording for starter checklist for April 2016 announced
From 6th April 2016, the starter checklist will be amended to accommodate the fact that Plan 2 students will come into payroll repayment for the first time. As there will now be two thresholds in payroll software, employers need to know which applies when someone changes jobs. A Plan 1 student took their loan out before September 2012 and currently repays when Ni’able pay exceeds £17,335 (this will rise in April 2016 but the threshold has not yet been announced). Plan 2 students took their loans out from September 2012 onwards and repay when Ni’able pay exceed £21,000. P45s will still only show a Y in the student loan box, as HMRC have no money to amend it as the form will soon be abolished, so without all new starters completing a starter checklist the employer won’t know which threshold to apply. If the student presents a P45 with a Y but the starter checklist has nothing completed, then the employer defaults to Plan 1 and awaits confirmation that is correct from HMRC via an SL1 starter notice. From April, the SL1 starter notice can also act as a switch notice (from 1 to 2 or vice versa). Since the advent of RTI, employers should ask all new starters to complete a starter checklist even if they present a P45, and this becomes even more vital from April. The new wording is as per this announcement from HMRC’s software developer’s support team:
